Traveling to Europe? Beware of the credit card trap that’s costing tourists big money

I just returned from a family vacation through France, Spain, and Portugal, and we had an amazing time. However, I couldn’t help but notice a new tourist trap that could have potentially cost me hundreds of dollars. The trap has to do with a practice known as Dynamic Currency Conversion, or DCC. Because of it, you’re at risk of losing money every single time you pay with a credit card—which, for most people nowadays, is almost always. And recently, it seems DCC has evolved to make it even easier to fall victim to the trap. First, here’s how DCC works in case you’re unaware: Let’s say you’re visiting Italy, Spain, or Portugal and you decide to make a purchase with your credit card. The terminal offers you an option: You can pay in U.S. dollars (USD), or you can pay in the local currency (in this case, euros). For the uninformed, it may seem like a good idea to pay in USD. But it’s absolutely not, because the exchange rate offered by the terminal is usually bad. Very bad. According to Visa, this could add an additional 3% to 5% markup through inflated exchange rates. In contrast, choosing to pay in local currency (like euros if you’re traveling in Europe) allows your card network an…